Steve and Elaine Wynn Settle Fight Over Control of Company Shares

Updated on
  • Each is free to sell their portion of $4 billion share stake
  • Filing shows they’ve agreed to unwind stockholder agreement

The Wynn Macau casino resort.

Photographer: Billy H.C. Kwok/Bloomberg

Steve and Elaine Wynn got divorced years ago, but their fight over a $4 billion stock fortune ended only this week.

Wynn Resorts Ltd. said in a filing Thursday that the pair, who together control 21 percent of the company, told a Las Vegas court they no longer consider a 2010 agreement between them valid. That frees both to sell their shares in one of the world’s glitziest casino chains after a bitter six-year battle for control of the stock.

It was an ugly fight, with Elaine Wynn accusing her ex of reckless spending and worse: covering up a sexual assault allegation brought by an employee through a secret, multimillion-dollar payment. That revelation ultimately led to Steve Wynn’s downfall, with a series of news accounts alleging sexual misconduct. The allegations have triggered probes into the billionaire’s conduct by regulators in Nevada, Massachusetts and Macau. Steve Wynn has denied assaulting anyone.

In court pleadings, Elaine Wynn also questioned her ex-husband’s judgment regarding the promotion and retention of senior officials at the company. Managers were promoted based on loyalty, more than integrity and ability, she said.

Wynn claimed her ex-husband misused company resources to support his “legendary lifestyle.” There was no effective protocol, or at least none approved by the board, to oversee his entertainment and travel expenditures, she said.

May Sell?

Thursday’s filing said the onetime King of Las Vegas may seek to sell all or a portion of his shares. A spokeswoman for Elaine Wynn declined to comment on her plans, but Wynn said previously she wanted control over the stock to focus on philanthropy.

The shareholder agreement, which also included company co-founder Kazuo Okada and his company Aruze USA Inc., said the three parties couldn’t sell their stock without approval of the others. The agreement gave Steve Wynn, then chairman and chief executive officer, control over a large chunk of Wynn Resorts, which owns casinos in Las Vegas and Macau.

Steve Wynn stepped down from the company last month following the allegations of sexual misconduct. Earlier this month, Wynn Resorts also settled a long-running suit with Aruze over the seizure of that company’s shares.

Wynn’s departure and the end of the shareholder agreement potentially make Wynn Resorts vulnerable to a takeover, especially if the former executive or his ex-wife sells or liquidates their stock. Casino regulators in Nevada, Macau and Massachusetts are still investigating the company’s handling of the harassment claims, probes that could result in Steve Wynn being found unfit to be the largest shareholder in a casino company and forced to sell some or all of his holdings.

Elaine Wynn still has claims pending in Las Vegas court against her ex-husband and the company related to her losing her seat on the board of directors in 2015.

(Updates with details of litigation starting in third paragraph.)
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